Govt unlikely to auction unsold spectrum soon at reduced price

Telecom Minister Manoj Sinha today hinted that spectrum which remained unsold in the just-concluded auction -- including premium 700 Mhz band -- will not be put up for sale immediately at reduced prices.

Even though the industry is of the opinion that the pricing was unrealistically high for the efficient 700 Mhz band, the minister defended the government’s decision. (PTI)

Telecom Minister Manoj Sinha today hinted that spectrum which remained unsold in the just-concluded auction — including premium 700 Mhz band — will not be put up for sale immediately at reduced prices.

“If the financial condition (of operators) is not good and they cannot take the spectrum now, what is the guarantee that they will take it, if we conduct auctions immediately. We will take a call at an opportune time,” the minister said.

He further said, “If they (operators) have not bought the spectrum, we believe they were not in condition to buy and also the ecosystem does not exist. So, we will talk once the ecosystem develops or they should say they can take it,” he said.

To a question on whether the government would prefer to wait before placing the unsold spectrum on the block once again, he said, “They (operators) have to make upfront payment now and other payments too…the industry view was that it (spectrum in 700 Mhz band) was expensive…they say they do not have the money. Keeping this in mind, government will decide what will be the right time for further auction.”

Even though the industry is of the opinion that the pricing was unrealistically high for the efficient 700 Mhz band, the minister defended the government’s decision.

“We have heard their (industry’s) view but the pricing was decided by a mechanism…the other thing is that appropriate ecosystem (for the band) is also not yet developed. Both reasons were there,” he said.

He declined to comment on chances of a price revision for 700 Mhz band saying, “We will see what is to be done based on the mechanism.”

Sinha further said that the spectrum auctions this year should be viewed differently from the auction held last year as it was not driven by “survival”, but by network requirements.

“You have to see it (this auction) from a different point of view as compared to previous auction. It was not survival auction. It was auction driven by requirement,” he said.

His comments come a day after the spectrum auctions – touted to be India’s largest sale of mobile airwaves – ended up garnering only Rs 65,789 crore, against an expectation of Rs 5.6 lakh crore, leaving nearly 60 per cent of airwaves, including premium 4G bands, unsold.